Cheap life insurance cover

What is cheap life insurance cover?

Cheap life insurance cover is another name for life insurance, an insurance product that will pay out a lump sum payment to the family of a customer who loses their life during the term of their policy.

There are two main different types of cheap life insurance cover. The most popular, and the cheaper of the two is term cheap life insurance cover, and this provides customers with life insurance cover for a certain term. The other is whole cheap life insurance cover and this provides customers with life insurance for their whole life, effectively guaranteeing a payout at some point.

Term cheap life insurance cover

Term cheap life insurance cover provides customers with life insurance for a certain term. This is usually offered alongside a new mortgage, and often runs for the period of the mortgage.

Term life insurance customers who live longer than their life insurance term will not receive a pay out when they finally die, and the majority of term life insurance customers fall into this category. This is why this form of life insurance cover is cheaper than whole life insurance cover.

Term life insurance cover looks after customers at their point of greatest financial responsibility, and the financial impact on a family losing a customer at 35 will be far greater than losing that same customer at 70 when the mortgage has been paid off and the children have grown up and become financially self sufficient.

Whole cheap life insurance cover

Whole cheap life insurance cover works in much the same way as term life insurance cover, but covers a customer until they die, however old they get. This makes this form of life insurance around eight times more expensive than term life insurance, because the insurance company have to pay out to every single customer. The life insurance company must therefore charge at least the value of the final payout in life insurance premium payments to make any profit at all.

Whole life insurance customers can borrow money against their final payout later on in life, when they no longer need it for their family. Whole cheap life insurance cover guarantees a return on the investment made by the customer, and for this reason it is still a popular form of insurance product.

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